Moody's rates Sterigenics

Moody's Investors Service said it assigned a B2 rating to the $205 million of senior secured credit facilities of Sterigenics International Inc., which include a $170.5 million seven-year first-lien term-loan and a $35 million five-year first-lien revolver. A $35 million second-lien term loan has been assigned a B3 rating.

The outlook is stable.

These facilities are guaranteed by Sterigenics' ultimate parent, Sterigenics Holdings Inc.

The credit facilities, together with the equity from PPM Ventures and PPM America Capital Partners and management, are being used to fund the holding company's acquisition of Sterigenics. Sterigenics was part of an unrated European corporation.

Moody's said it views Sterigenics' currently strong contract sterilization business, marked by long lived customer relationships, as its primary credit strength. In addition, the B2 rating recognizes Sterigenics' leading market positions and its stable source of revenues and operating cash flow.

The B2 senior implied rating also reflects the relatively small size of Sterigenics' revenue base and customer concentrations. Total debt is likely to exceed total revenues for most of the next three years.

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